Malaysian airline company, AirAsia has indicated its return to Nepal After five and a half years of suspending flights at Tribhuvan International Airport,.
AirAsia’s Kathmandu flights had been halted since Aswin 27, 2075 (October 13, 2018). The airline had suspended flights due to the dispute over payment of service charges to the Tribhuvan International Airport office.
On Aswin 27, 2075, the then chief of the airport office, Rajkumar Kshetri, had prevented AirAsia’s aircraft from taking off, citing the airline’s failure to clear its dues in Nepal. That day marked the airline’s final flight.
At that time, the airline had not paid more than 18 crores, and the airport office had imposed a ban on its flights until the outstanding amount was settled. However, AirAsia had committed to clear the dues through diplomatic channels and had resumed flights.
Following that, AirAsia had not reached any agreement to clear the outstanding dues. There hadn’t been any visible efforts from the Civil Aviation Authority of Nepal (CAAN) to take action, but now, after five and a half years, the authority’s spokesperson, Jagnnath Niroula, has confirmed that AirAsia has agreed to clear the old dues.
According to him, AirAsia has submitted bank guarantees for the payment of 24 crores within 24 months, with a rate of 1 crore per month, payable on the 28th of every English month. They have also agreed to pay an additional 15 lakhs. AirAsia has not submitted any application for flights yet.
Even though no bid has been submitted for flights, the agreement to clear the old dues indicates a sign of returning to flights to Nepal.
AirAsia is a budget airline. With its return to Nepal, it is anticipated that traveling to and from Malaysia will become easier and tickets will be more affordable.
AirAsia has also appointed necessary GSA (General Sales Agent) for flights, but the authority has not been informed about it. However, Universal Travel has confirmed that they have been appointed as the GSA for AirAsia. Currently, even the GSA requires approval from the authority.
How was AirAsia suspended?
AirAsia, which had been operating regular flights, had not been informing the Airport Development Fee and the Tourism Board of the amount required for tourism fees for a long time.
This amount used to be collected by the airlines when purchasing tickets, without taking cash from the passengers. In the past, Hariman Lama, the representative of AirAsia in Nepal, had clarified that the amount owed to the airport office had not been disclosed.
For a long time, the amount to be paid back to the airport office had been accumulating in the mutual understanding of the higher officials at the airport office. When the flights started, the airline had paid only 27 crores to the airport office, including a late fee of 13 crores.
Including the late fee, AirAsia was supposed to pay around 40 crores to the airport office. Lam, AirAsia’s agent in Nepal, had been submitting the remaining dues to the airport office sporadically, sometimes within 15 days, sometimes within a month. However, they had not cleared the amount.
Ultimately, AirAsia’s flights were suspended. Meanwhile, AirAsia’s head office was also sent a letter by the airport office. The letter warned of action if the old dues were not paid.
Representatives of the airline came to Nepal after the letter was sent. In bilateral discussions, the airline company agreed to a written agreement to clear the dues at the rate of 5 crores per month, starting from 5 months to 5.5 months. However, the airline’s representatives demanded a waiver of the late fee.
The former head of the airport office, Kshetri, refused to waive the fee in response to the company’s proposal. After that, the company submitted 16 crores in three installments.
Afterwards, when the company delayed paying the installment, the head of the airport office sometimes suspended the company’s flights for 30 minutes and sometimes for 40 minutes. When flights were disrupted, the airline announced the immediate suspension of flights, citing the settlement of dues in July.
Meanwhile, the closure of employment opportunities in Malaysia due to disputes over illegal funds, biometric health examination companies, MyGraam, ICSI, and OCS, also had a further impact. This directly affected AirAsia. When AirAsia flew from Malaysia to Kathmandu, it had an occupancy of 80 to 90 percent in ‘inbound’ flights, but when flying back to Kathmandu, it was carrying only 30 to 40 number of passengers on aircraft with a capacity of 300 passengers. This eventually led to AirAsia’s suspension of flights to Nepal again, with the indication of returning to flights with the settlement of old dues.